NEW YORK -- Thomson Reuters'
revenue forecast for 2013 failed to impress Wall Street
and the shares fell 3 percent, overshadowing bullish remarks
from Chief Executive James Smith that his turnaround plan was
gaining traction.

The global news and information company posted a
better-than-expected rise in quarterly profit on Wednesday and
forecast that revenue would increase in the low single digits
this year. The outlook was largely anticipated by analysts, who
had forecast a 2 percent rise.

"It looks like another year where the overall growth will be
muted," said Claudio Aspesi, a senior analyst at Sanford
Bernstein & Co.

Smith said the company was halfway through his turnaround
plan because of product improvements and stabilization in Europe
and that he expects revenue to rebound. "The success we are
having today doesn't start showing up until next year," Smith
said in an interview. He later told analysts on a conference call, "It's like
night and day. We are in a different place."

Smith said he expected Financial & Risk net sales to turn
positive in the second half of the year. This an important gauge
of future performance because subscription-based revenue
typically lags sales by 12 months. Financial & Risk, which accounts for 54 percent of total
revenue, has struggled in recent years following a troubled
launch for its flagship desktop product Eikon, which is aimed at
bankers, hedge fund managers, and other financial industry
professionals.

Cost cutting by banks after the financial crisis compounded
the difficulties, especially in Europe. Smith said the company expects to cut 2,500 jobs in the
Financial & Risk division, or about 4 percent of its total
global staff, in 2013. The company said it plans to spend $100
million in severance costs this quarter.

UPSIDE SURPRISE

Thomson Reuters said revenue from ongoing businesses in the
fourth quarter rose 2 percent before currency changes to $3.36
billion, roughly in line with expectations. It was not
immediately clear what the change in costs was on the same
basis. Adjusted earnings increased to $497 million, or 60 cents
per share, from $445 million, or 54 cents per share, a year
earlier, beating analysts' average forecast for 55 cents per
share, according to Thomson Reuters I/B/E/S.

Profit in the quarter increased on the back of "continued
cost containment and lower reorganization costs", the company
said. Organic revenue was flat.

"They have worked very hard on cost and the efforts should
be acknowledged," Aspesi said.

The number of Eikon desktops installed rose 33 percent in
the fourth quarter from the previous quarter to 33,900. For the fourth quarter, revenue at the Financial & Risk
division increased 1 percent due to growth in its Governance,
Risk & Compliance business and its acquisition of electronic
foreign exchange platform FXall.

Revenue in the division's Europe, Middle East and Africa
region and in Asia was down 3 percent, respectively, while the
Americas gained 6 percent.

Its Legal division, which includes WestlawNext, reported
that revenue rose 2 percent in the quarter to $861 million. Thomson Reuters recently acquired London-based Practical Law
Company, which provides guidance and analysis tailored to
specific areas of the law.

The board approved a 2 cent annual dividend increase to
$1.30 per share. Thomson Reuters' New York and Toronto listed shares were
down 2.9 percent at $29.77 and C$29.81, respectively.